Regulatory T cells (Treg)s attenuate excessive immune responses, making their expansion beneficial in immune-mediated diseases including allogeneic bone marrow transplantation (BMT)-associated graft-versus-host disease (GVHD). We have recently reported that Treg expansion does not require phospholipase Cγ activation when IL-2 is provided. As such, the combination of IL-2 and a calcineurin inhibitor (Cyclosporine A; CsA) expands Tregs while inhibiting Tconv proliferation and protects against a mouse model of multiple sclerosis. However, CsA inhibits Treg proliferation in the presence of a TCR stimulus, suggesting that CsA may negatively impact Treg proliferation when they receive strong allogeneic MHC-mediated TCR signals. In this study, we show that CsA inhibits Treg proliferation and inducible Treg generation in allogeneic but not in syngeneic BMT when IL-2 is provided. In contrast to CsA, the mTOR inhibitor (Rapamycin) almost completely suppressed IL-2-mediated Treg proliferation. However, CsA and Rapamycin inhibited Treg proliferation to a similar extent when TCR stimulation was provided. Furthermore, Rapamycin promoted Treg expansion and inducible Treg generation in allogeneic BMT recipients treated with IL-2. Consistent with these observations, CsA abrogated while Rapamycin promoted the protective effect of IL-2 on allogeneic BMT-induced GVHD. These results suggest that while CsA permits IL-2-induced Treg proliferation in the syngeneic setting (absence of strong TCR signals), CsA in combination with IL-2 may be detrimental for Treg proliferation in an allogeneic setting. Thus, in allogeneic settings, an mTOR inhibitor such as Rapamycin is a better choice for adjunct therapy with IL-2 in expansion of Tregs and protection against allogeneic BMT-induced GVHD.